Investing 101 for millennials

Investing can be intimidating, especially if you’re new to it and try to do it alone. As an advisor and a millennial myself, I’d like to shed some light on the importance of investing and working with an advisor, and I’ll begin with my single, best piece of advice…start early.

It sounds so simple, but in order to maximize the potential of your investments, it is important. Most millennials don’t have significant investable assets, so a savings account and 401(k) are some of the easiest and best ways to get started. Even if it’s a small amount you’re putting away each paycheck, as long as you become disciplined, the compounding interest over time is going to be something you’re extremely thankful for when you’re older.

Many millennials often tell themselves, “I’ll start investing after I begin making more money.” What they don’t realize is that with increased income comes an increased lifestyle and spending, making it harder to carve away funds for investments and savings. By starting early and allocating a small amount to a 401(k), a Roth IRA or any other vehicle, it becomes second nature and the money won’t be missed. Your savings will grow and be there for you when you need it down the road. Eventually, you will have investable assets and advisors are there for you as a resource to ask questions when you buy a house, have a family, or gain an inheritance, etc. They can help you strategize and put a plan in place to get ahead.

Most people don’t think they need an advisor and millennials in particular tend to believe this. However, when it comes to investing and making your own financial decisions, emotion plays a big role. Advisors don’t use emotion in decision making. We look at investing without biases and make decisions based upon fundamentals, whether a company is a solid company and if it will do well going forward. We don’t make decisions based on the trendiest headlines of the week. Also, people tend to get anxious by market fluctuations. An advisor brings balance. They’re in control of the investments and have the resources to navigate the market and make rational long term decisions on your behalf.

Finally, I want to stress to millennials that advisors are not out to trick you or mislead you. We’re here to help you throughout every milestone in your life. Lately, there seems to be a lack of trust in the financial advising industry, and rebuilding that is difficult. As a millennial advisor, I want to help break down walls and reestablish that trust.

We look at the big picture of your financial life and at Fort Pitt we create plans to help you achieve your long term goals. We’re here for the long haul.